In this Monday, Dec. 3, 2012, photo, John Stumpf, Chairman, President and CEO of Wells Fargo, talks during an interview, in New York. Stumph, one of the few CEOs who kept his job as peers fell after the 2008 financial crisis, is a strategist who expanded his company while others shrank theirs. Stumph says Wells Fargo’s vanilla business model of making loans and taking deposits has kept it above the fray while exotic derivatives and other risky practices have bludgeoned rivals. (AP Photo/Mark Lennihan)

He’s a CEO who kept his job as peers fell after the 2008 financial crisis, a strategist who expanded his company while others shrank theirs, a personable banker at a time of great anger toward his industry.

Stumpf is the boss of Wells Fargo, the nation’s fourth-largest bank by assets and Minnesota’s largest by deposits — and one of the few that emerged from the financial crisis with a reputation for responsible banking.

The bank likes to say its vanilla business model of making loans and taking deposits has kept it above the fray while exotic derivatives and other risky practices have bludgeoned rivals. Today, Wells controls a third of the U.S. mortgage market, giving it by far the biggest share of any bank.

The mortgage strategy has its own problems, though, including lawsuits over questionable lending. In October, for example, the Justice Department sued Wells, accusing it of misrepresenting the quality of thousands of mortgage loans that the Federal Housing Administration insured and that later defaulted.

San Francisco-based Wells was one of the largest banks in the country but relatively unknown outside the Western U.S. before 2008, when it scooped up teetering Wachovia in the depths of the financial crisis.

The bank has turned a profit every quarter since 2009, when the purchase was complete. Earnings have expanded while revenue has stayed steady.

Like other big banks, Wells Fargo’s stock has had an impressive year, gaining about 20 percent. But unlike the others, it’s close to its pre-crisis heights. The stock was around $35 when Stumpf took over in the summer of 2007. It closed Thursday at $33.18.

In an interview, Stumpf, 59, talked about why he’s fighting the government’s lawsuit, why he’s less than enthusiastic on the economy and when it’s OK to ditch the suit and tie.

Questions and answers have been condensed and edited for clarity and length.

What’s your prediction for the economy? Could we move into a reasonably strong economy in the next couple of years just naturally, because we’ve been in a downturn for so long?

I don’t know that I subscribe to that. It takes more planning and more leadership. We’ve got $16 trillion of federal debt, we have deficits as far as the eye can see, 10,000 people retire every day in this country and are getting (extremely low interest rates) on their savings. Left to its own, it will look very much like what it’s looked like so far.

So what do we do?

There’s still too much uncertainty — tax policy, health care, entitlements, a whole bunch of other things. I would like to see the public sector and private sector get on the same page. Take something like housing. We have states that are passing new laws around housing that sometimes are in conflict with the national standards. What will happen to the mortgage interest deduction?

We don’t know these things. And when it’s uncertain, the private sector feels it in a big way.

We think they got that wrong. Our FHA lending activity and servicing, we’ve done it in good faith, we have met the requirements that were laid out. The proof was really in the results — our portfolio performs better than others. We have a number of defenses. This is one we’re going to take on.

People hate bank fees. Bank of America just decided to postpone new fees on its checking accounts. Where do you see this going?

We try to be transparent in what we do. I think what really irritates customers is where they believe they got something at this price and find out there’s some other language in there and they really paid this price.

What we want to provide for customers is a good, fair deal. We have 6,000 (branches), 12,218 ATM machines, 24/7 bankers, online, and all this stuff costs money. We give people (free) access if they do enough business with us.

If they choose not to do business with us but for one thing, we charge them ($7) a month for the access to that nationwide distribution. That’s a bargain. Our customers understand that. We’ve had minimal issues in that area. Our customers have higher loyalty scores with us than we’ve ever had.

You’ve been pretty outspoken against some of the new government regulations imposed on the banking industry.

I’m not against regulation. I like good, effective regulation. What I worry about are the unintended consequences of well-intended people who pass laws that make it harder to lend money, make it more difficult for consumers and small businesses and large businesses to get credit.

You were outspoken against the idea of a standalone Consumer Financial Protection Bureau when it was proposed. What do you think of the job they’ve done so far?

These are good people, and they’ve been asked to do an impossible job. I hope they get it right.

Do you want to be treasury secretary?

I have a full-time job. I love leading Wells Fargo.

THE STUMPF FILE

John Stumpf, 59, the CEO of Wells Fargo, is the son of a farmer, second-oldest in a family of 11 kids. He paid for state college by playing bass guitar in a band.

“I never set out to be the CEO of this company,” Stumpf, who started in banking as a repo agent, said in an interview with the Associated Press. “Life just happened.”

– HOMETOWN: Pierz, Minn.

– CAREER: Stumpf’s first job out of college, in 1976, was as a repo agent for a regional bank in Minnesota. A few years later, he joined Minneapolis-based Norwest Corp., which later bought Wells Fargo and adopted its name and San Francisco headquarters.
Stumpf worked as a regional president around the western U.S., and moved up to the CEO job in 2007 after Dick Kovacevich retired.

– GROWING UP STUMPF: Stumpf was raised on a farm in rural Minnesota, in a house where everyone had to play a musical instrument before he or she was allowed to play sports.

– GO HUSKIES: Stumpf earned a finance degree from St. Cloud State University in St. Cloud, Minn., and an MBA from the University of Minnesota. Harvard, he says, is a terrific school, “but if that were the only place to create CEOs, we would be missing a lot of them.”

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